Government is borrowing more to plug budget gapsGlobal ratings agency Moody’s has warned that if Kenya does not reverse its increasing debt, then it might get into a financial crisis. The agency said it was particularly concerned about payment of interest which has been consuming a lot of tax revenue over the past five years. Fiscal consolidation involves implementing policies to reduce budget deficits and accumulation of debt stock. “Part of the lower income tax revenue could be offset by the removal of tax exemptions and waivers,” said Moody’s, with several measures already included in the Finance Act. “The pandemic did not only worsen revenue performance in 2019-20 financial year, but will also affect revenue performance,” Treasury said.

Source: Standard Digital September 18, 2020 00:11 UTC